Transmission Channels between Financial Deepening and Economic Growth: Econometric Analysis Comprising Monetary Factors

Contemporary literature continues to foster discussion whether financial development is important for economic growth. In the clash of theoretical arguments, the prevailing idea is that finance exerts a direct positive influence on GDP growth. However, the presence of theoretical counterarguments and contradictory results of empirical studies suggest that scientists, in search of an answer about the direction and power of the net effect, should develop methods of empirical analysis, and the very mystery of the relationship between finance and growth will finally be solved exclusively empirically. In this paper, the authors contribute to the development of the ‘finance-growth’ literature by answering some existing questions concerning the transmission channels from finance to growth, relying on more recent data compared to already conducted studies. We use panel data covering the period 1995 to 2019 for 168 countries. In addition, the paper touches on the problem of studying the exogenous conditions of such channels, considering the assumption that among these conditions there may be those that hinder the impact of financial deepening on economic growth. Our focus is on monetary conditions, and in the empirical part of the study, we touch upon the problem of the influence of price stability on the operation of these transmission channels. The methods of the conducted study are based on the dynamic panel data analysis techniques (System GMM). The novelty of this paper lies in the development of the modern theory of the financial sector transmission mechanism in the economic growth context. The main result of the study is that productivity channel is the most reliable transmission channel of financial deepening to economic growth. Furthermore, the effectiveness of this channel remains virtually unaffected by inflation. The channel of capital accumulation should be considered less reliable (in terms of statistical reliability of estimates obtained), but it has turned out to be a more economically significant transmission channel. This channel is sensitive to the inflation factor in certain categories of countries. Finally, as follows from the estimates gained, the non-linearity of the “finance-growth” relationship can be explained by the non-linearity of the variable responsible for the capital accumulation channel.

External Shocks and Their Transmission Channels in Nigeria: A Dynamic Stochastic General Equilibrium Approach

The study examines the sources of external shocks and investigates their transmission channels in Nigeria using the trade-weighted variables from the country’s five top trading partners. Based on the assumption of the small open economy model, the study adopts the New Keynesian Dynamic Stochastic General Equilibrium Model on quarterly data between 1981 and 2018 using the Bayesian estimation technique. Findings from the study reveal that external shocks have a temporary and short-lived effect on the Nigerian economy. In addition, the article shows that oil price, foreign output, and foreign inflation shock have positive impacts on output gap and inflation, while the impact of foreign interest rate shock on the output gap and inflation is negative and not significant. The study also reveals that external shocks collectively explain 86% and 39%of total fluctuations in the output gap and inflation, respectively. Lastly, the study finds that external shocks transmit to the Nigerian economy via different channels. The study, therefore, concludes that terms of trade and exchange rate channels are the dominant transmitters of external shocks in Nigeria. Based on the findings from the study, important policy implications are highlighted.

Application of spectral analysis for determine the phase shift of signals with equal amplitudes using full-wave transformation when measuring the characteristics of weapons

The article defines the list of technical characteristics of armaments and military equipment (ARM), the value of which is measured using phase methods. An analysis of known methods that have found wide application in measuring technology, which is designed to determine the technical characteristics associated with the measurement of phase shift during the development, manufacture and operation of weapons. Based on this analysis, it was determined that the measuring systems are designed to determine the phase shift of two harmonic signals in their composition have two channels of information transmission. This architecture of the implementation of measuring systems leads to the fact that a significant impact on the accuracy of the proposed measurement problem, makes a component of the error due to the phase symmetry of the signal transmission channels, as well as internal and external noise. As an alternative approach to solving the measurement problem of determining the phase shift of two harmonic signals, which will significantly reduce the error component due to phase asymmetry of information transmission channels, it is proposed to use the signal obtained by summing harmonic signals after full-wave transformation followed by spectral analysis. In order to implement the above approach, a measurement problem was set to determine the phase shift of two harmonic signals, using spectral analysis of the signal obtained by summing the harmonic signals after their full-wave transformation. A list of assumptions required for the synthesis of analytical relations that establish the relationship between the spectra of phases and amplitudes (power) of the signal obtained by summing harmonic signals after their full-wave transformation and phase shift of two harmonic signals. Analytical relationships are proposed that establish the relationship between the above characteristics. It is shown that the values of the spectrum of phases and amplitudes, which are calculated using the proposed expressions, differ from the values obtained in the calculations using the Fourier series coefficients, not more than 0.1%.